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Array BioPharma Reports Financial Results for the Fourth Quarter And Full Year of Fiscal 2001

BOULDER, Colo., Aug. 6 /PRNewswire/ -- Array BioPharma Inc. (Nasdaq: ARRY) today reported financial results for the fourth quarter and the full year of fiscal 2001, ending June 30, 2001.

During the fourth quarter of fiscal 2001, total revenues reached $5.7 million, up 152% from $2.2 million in the same period in fiscal 2000. Net loss for the fourth quarter before extraordinary charges related to early extinguishment of debt was $1.4 million or ($0.06) per share, compared to a net loss of $1.8 million or ($0.14) per share for the comparable quarter in fiscal 2000. Revenues for the fiscal year ending June 30, 2001 were $17.0 million, compared to revenues of $6.8 million for the fiscal year ending June 30, 2000. The pro forma net loss for the fiscal year ending June 30, 2001 was $10.4 million or ($0.52) per share, compared to a pro forma net loss of $5.1 million or ($0.44) per share, reported for fiscal year 2000. Excluding non-cash compensation-related charges incurred in fiscal year 2001 results in an adjusted pro forma net loss per share of ($0.03) for the fourth quarter and ($0.29) for the fiscal year ending June 30, 2001.

"As reflected by these results, Array has experienced dramatic growth in its revenues, scientific staff and laboratory space during fiscal year 2001," said Robert E. Conway, Chief Executive Officer. "The increasingly competitive environment faced by pharmaceutical, biotechnology and genomics companies to create new drugs is fueling the demand for high-quality, small molecule drug discovery expertise. These companies are increasingly seeking a quality partner with an experienced scientific team and a track record of success in creating drug candidates, which is driving Array's success within the industry."

Highlights during the fourth quarter of fiscal 2001 include:

  • Increased revenues by 152% for the fourth quarter of fiscal 2001 and 151% for the year ending June 30, 2001, compared to the same periods last year, which was driven by new partnerships and expanded collaborations.

  • Entered into an agreement with Trimeris, Inc. to discover and develop small molecule fusion inhibitors against two drug targets. Trimeris will pay research fees to Array, plus milestone payments and royalties upon achievement of certain drug discovery objectives.

  • Expanded a collaborative agreement with CambridgeSoft Corporation to enhance Array's chemoinformatics platform. CambridgeSoft was instrumental in the development of Array's chemistry-based electronic notebook, which enables real-time bench top recording and access to all chemical information within the Company. Benefits of this new partnership include an enhanced ability to share knowledge across the organization and to select and synthesize compounds, as well as an accelerated capability to make decisions.

  • Established a new library agreement with Roche and expanded relationships with a number of existing collaborators.

  • Hired 27 additional scientists to Array's staff, increasing total scientific headcount to 130, as of June 30, 2001.

  • Repaid $5 million of debt during the quarter, eliminating all debt from the Company's balance sheet.

"During this quarter, we continued to execute our strategy of building the industry's premier drug discovery platform," said Mr. Conway. "Array currently employs 136 scientists, half of whom were hired in just the past 12 months. We continue to recruit high-caliber scientists at a rapid rate. During the coming year, we plan to expand our chemistry-rich drug discovery platform to include cGMP manufacturing through Phase I clinical trials, and drug metabolism capabilities. In addition, we are enhancing our predictive computational modeling and high throughput screening groups as well as increasing our investment in our own proprietary drug research."

Array ended the fourth quarter with $47.7 million in cash and marketable securities. During the fourth quarter, all debt from prior equipment financing of $5 million was repaid early. As a result, $225,000 of extraordinary charges related to early extinguishment of debt was incurred, including a $96,000 non-cash charge related to the value of warrants issued to the lenders at the time of the original financings.

The pro forma net loss per share for the fourth quarter and the full year of fiscal 2001 of ($0.06) and ($0.52), respectively, assumes conversion of all convertible preferred stock into common stock as of the beginning of the fiscal year and excludes extraordinary charges from early extinguishment of debt and the deemed dividend from conversion of Array's preferred stock in connection with its initial public offering. These results include $619,000 and $4.7 million, respectively, of non-cash compensation-related charges for the fourth quarter and the fiscal year ending June 30, 2001. Excluding these non-cash charges results in adjusted pro forma net loss per share of ($0.03) and ($0.29) for the fourth quarter and the full year of fiscal 2001, respectively.

Array will hold a conference call on Tuesday, August 7, 2001, at 9:00 a.m. EDT to discuss these results. Robert E. Conway, Chief Executive Officer and R. Michael Carruthers, Chief Financial Officer of Array, will lead the call.

Date: Tuesday, August 7, 2001

Time: 9:00 a.m. Eastern Time
Conference call numbers:
     Toll-free:               (800) 967-7143
     Outside the U.S.:        (719) 457-2631
     Web cast:                www.arraybiopharma.com

There will be a replay of the conference call for 7 days that can be accessed by dialing toll-free (888) 203-1112, and outside the U.S. (719) 457-0820. The access code is 436848. Replay of the call will also be available as a web cast on Array's web site at www.arraybiopharma.com.

Array BioPharma is a drug discovery company creating new drugs through innovations in chemistry and structural biology. Array's world-class scientific team integrates chemistry and structural biology with an information-based technology platform to create higher quality drug candidates. Array provides drug discovery expertise to collaborators and for its own proprietary research. For more information on Array BioPharma, please visit the company's web site at www.arraybiopharma.com.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks and uncertainties, including those discussed below and described more fully in reports filed by Array with the Securities and Exchange Commission, including our final prospectus as filed on November 16, 2000. Because these statements reflect our current expectations concerning future events, our actual results could differ materially from those anticipated in these forward-looking statements as a result of many factors. These factors include, but are not limited to, our ability to achieve and maintain profitability, the extent to which the pharmaceutical and biotechnology industries are willing to collaborate with third parties on their drug discovery activities, the ability of our collaborators and of Array to meet drug discovery objectives tied to milestones and royalties, and our ability to attract and retain experienced scientists and management. We are providing this information as of August 6, 2001. We undertake no duty to update any forward-looking statements to reflect the occurrence of events or circumstances after the date of such statements or of anticipated or unanticipated events that alter any assumptions underlying such statements.

                             Array BioPharma Inc.

                      Condensed Statement of Operations
                   (in thousands, except per share amounts)

                                  Three Months Ended     Twelve Months Ended
                                       June 30,               June 30,
                                   2001       2000        2001        2000
                                     (unaudited)

    Revenue                       $5,671     $2,248      $17,006     $6,774
    Cost of revenue*               3,851      1,654       12,965      4,445
    Gross profit                   1,820        594        4,041      2,329

    Research and
     development expenses*         2,288      1,327        8,265      3,963
    Selling, general and
     administrative
     expenses*                     1,480      1,049        7,668      3,470
    Total operating
     expenses                      3,768      2,376       15,933      7,433
    Loss from operations          (1,948)    (1,782)     (11,892)    (5,104)
    Interest expense                 (86)      (126)        (587)      (384)
    Interest income                  653        119        2,092        356
    Net loss before
     extraordinary item           (1,381)    (1,789)     (10,387)    (5,132)
    Pro forma net loss
     per share - including
     preferred                    $(0.06)    $(0.14)      $(0.52)    $(0.44)
    Pro forma shares used
     in computing net loss
     per share - including
     preferred                    23,176     13,133       19,792     11,721
    Deemed dividend related
     to beneficial
     conversion feature
     of preferred stock               --         --       (5,000)        --
    Extraordinary item -
     charges from early
     extinguishment of debt         (225)        --         (225)        --
    Net loss applicable
     to common
     stockholders                $(1,606)   $(1,789)    $(15,612)   $(5,132)
    Basic and diluted
     net loss per share
     applicable to common
     stockholders                 $(0.07)    $(0.55)      $(0.99)    $(1.68)
    Shares used in
     computing basic and
     diluted net loss
     per share                    23,176      3,255       15,693      3,063

  • Includes compensation related to option grants:

      Cost of revenue               $248        $38         $998        $43
      Research and
       development expenses          166         31          644         35
      Selling, general
       and administrative
       expenses                      205        347        3,012      1,040
        Total                       $619       $416       $4,654     $1,118


                            Summary Balance Sheet Data
                                  (in thousands)

                                            June 30,                June 30,
                                              2001                    2000
    Cash, cash equivalents
     and marketable securities              $47,712                  $5,784
    Working capital                          44,917                   2,210
    Total assets                             70,950                  15,823
    Stockholders' equity                     62,468                   6,653

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SOURCE Array BioPharma Inc.

CONTACT: Tricia Haugeto of Array BioPharma Inc., +1-303-386-1193, thaugeto@arraybiopharma.com/

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